AIG has established a joint venture with the People’s Insurance Company of China’s (PICC) life insurance arm.

The operation looks set to distribute life and retirement insurance and property and casualty products in China.

US-based AIG will own 24.9% of the company, with PICC Life holding the remaining 75.1%. Board seats and management assignments will be based on the shareholdings.

“Chinese consumers are changing the way they want to purchase and utilise insurance products throughout their lifetimes and we are confident this joint venture will be a leader in helping these consumers achieve this goal,” PICC Chairman Wu Yan said.

The joint venture is to start operating by the first quarter of next year, subject to regulatory approval.

Last December AIG became the largest cornerstone investor in the PICC initial public offering, injecting $US500 million ($522 million).